Credit Crisis Roundtable

Yesterday Al sat down with four Minnesotans facing deep credit card debt for a roundtable about the credit crisis. They shared several stories of predatory practices from credit card companies, including a woman who was given a credit card at her dentist’s office to pay for a procedure she could not afford and ended up with hidden fees and high interest rates that left her further in debt than she started after a year of working to pay it off. A young woman who had just graduated from college had paid for her living expenses on credit cards during her college years ­ despite working part-time through school, the combined balances on several credit cards with high interest rates meant that she graduated with several thousand dollars of credit card debt on top of her student loans, and could not join AmeriCorps or the Peace Corps as she’d hoped.

Al proposed major reforms to address the growing personal credit crisis, including a Credit Card Bill of Rights that would crack down on predatory lenders.

From the Star Tribune:

DFL Senate candidate Al Franken, saying that he fears a massive credit crunch will be the next financial crisis afflicting the middle class, proposed a series of changes Wednesday designed to protect consumers from soaring interest rates and predatory lenders.

Franken also accused his main opponent, Republican Sen. Norm Coleman, of failing to help those duped or forced into accepting outrageous credit terms. Coleman campaign officials disputed Franken’s charges.

Franken announced his proposals after hosting a roundtable discussion at a St. Paul restaurant with four women who said they had been socked with inequitable credit schemes in a variety of circumstances.

Al’s proposal includes the repeal of the 2005 Bankruptcy Act, which Norm Coleman supported. In the words of the Star Tribune editorial board, it “places the interests of lenders above those of consumers.”

From MPR:

DFL Senate candidate Al Franken is calling for several law changes which he says would better protect consumers from creditors.

Franken wants to repeal the 2005 Bankruptcy Act. He also wants to ban credit card companies from what’s called “universal default.”

“There is no reason that anyone should believe that just because they missed one payment on one credit card that any other credit card company they have has the right to raise their interest rate,” Franken said.

This entry was posted on Thursday, August 14th, 2008 at 2:56 pm and is filed under From the Trail, News Clips. You can follow any responses to this entry through the RSS 2.0 feed.